What result does an increase in price typically have on quantity supplied?

An increase in price typically leads to an increase in quantity supplied due to the incentives that higher prices create for producers. When the price of a good or service rises, it becomes more profitable for producers to supply more of it. This relationship is a fundamental principle in economics known as the law of supply, which states that, all else being equal, an increase in price results in an increase in the quantity supplied.

Producers are driven by profit motives; thus, they are more willing to allocate resources and increase production when they expect higher prices will cover their costs and yield greater revenues. Additionally, higher prices can enable producers to cover any increased production costs associated with expanding output.

In contrast, other choices imply scenarios that do not align with this principle. A situation where quantity supplied remains unchanged would suggest a perfectly inelastic supply, which is generally not the case for most goods. A decrease in quantity supplied with an increase in price contradicts the typical market behavior described by the law of supply. Finally, the dependency on consumer demand does play a role in overall market equilibrium, but it does not negate the direct relationship between price and quantity supplied in this context.